What’s Driving This Correction ?

The bitcoin is facing a new setback, shaken by a market that is reevaluating its expectations. Indeed, the publication of a solid economic report in the United States has strengthened the dollar, which reduces the likelihood of an imminent interest rate cut by the Federal Reserve. Such a reaction has led to a correction below 93,000 dollars. This has temporarily slowed down the bullish momentum of crypto. However, Grayscale remains confident and sees this pullback as a passing turbulence rather than a trend reversal. According to Zach Pandl, head of research at the company, the strength of the dollar and the restrictive monetary policy are temporarily weighing on the market, but the fundamentals of bitcoin remain strong. With rising institutional adoption and a changing regulatory environment, the bullish trajectory seems intact, despite short-term fluctuations.

The weight of macroeconomic factors on bitcoin

On January 10, the publication of a report on employment in the United States caused a shockwave in the financial markets. Contrary to expectations, the figures highlighted a robust economy, which reduced hopes for a rapid monetary easing by the Federal Reserve. In response, the US dollar strengthened, a move that immediately weighed on assets perceived as alternatives to traditional currencies, including bitcoin.

Under the pressure of this situation, the world’s first cryptocurrency fell below 93,000 dollars. Such a situation erased some of the gains recorded at the beginning of the year. According to Zach Pandl, head of research at Grayscale, this decline results from an unfavorable macroeconomic context. “The bitcoin seems to be hindered by the strength of the dollar, which is rising due to stricter monetary policy from the Fed and the threat of new tariffs,” he explains. Meanwhile, futures markets have adjusted their forecasts, giving only a 3 % probability to an interest rate cut in January. This lack of monetary support reduces the appeal of risky assets and temporarily hinders the bullish dynamics of bitcoin.

A rebound supported by structural dynamics

Despite the pressure exerted by the macroeconomic context, several factors continue to support a bullish trend for bitcoin. Among them, the political change in the United States could play a decisive role. Donald Trump, elected in November 2024, reaffirmed his intention to make the United States a global leader in crypto. His administration plans to ease regulations by appointing industry-friendly leaders within federal agencies. This orientation could encourage a more conducive climate for innovation and crypto adoption.

The rise of Bitcoin ETFs is another key driver. In November 2024, these exchange-traded funds surpassed the threshold of 100 billion dollars in assets under management, a strong signal of growing institutional interest. According to Steno Research, this dynamic is expected to amplify in 2025, with incoming flows estimated at an additional 48 billion dollars. Such an injection of capital could absorb part of the current volatility, reinforcing bitcoin’s legitimacy as a leading financial asset. Some observers, including those from Sygnum Bank, believe that these massive inflows could generate a demand shock, propelling bitcoin to new all-time highs.

The fluctuations of bitcoin in reaction to macroeconomic events are not new. However, the projections from Grayscale and Steno Research suggest that 2025 could mark a turning point for institutional adoption and market structuring. The regulatory environment, supported by a more crypto-friendly administration, could favor an unprecedented influx of capital. Meanwhile, the monetary policy of central banks, particularly that of the Federal Reserve, will play a crucial role. A potential easing of interest rates could give an advantage back to risky assets, thus enhancing bitcoin’s attractiveness to institutional investors. If these dynamics materialize, the leading crypto could quickly regain its momentum and reach new all-time highs in a rapidly changing market.

Luc Jose A.

Diplômé de Sciences Po Toulouse et titulaire d’une certification consultant blockchain délivrée par Alyra, j’ai rejoint l’aventure Cointribune en 2019.
Convaincu du potentiel de la blockchain pour transformer de nombreux secteurs de l’économie, j’ai pris l’engagement de sensibiliser et d’informer le grand public sur cet écosystème en constante évolution. Mon objectif est de permettre à chacun de mieux comprendre la blockchain et de saisir les opportunités qu’elle offre. Je m’efforce chaque jour de fournir une analyse objective de l’actualité, de décrypter les tendances du marché, de relayer les dernières innovations technologiques et de mettre en perspective les enjeux économiques et sociétaux de cette révolution en marche.

DISCLAIMER

The views, thoughts, and opinions expressed in this article belong solely to the author, and should not be taken as investment advice. Do your own research before taking any investment decisions.